Aiding business integrity via private sector education

By Terence D. Jones - Resident representative a.i. UN Development Programme (left) and Nguyen Quang Vinh - Secretary general, Vietnam Chamber of Commerce and Industry

Vietnam went through the second review cycle in 2019, which included the review on Corruption Prevention and Asset Recovery related chapters. An important part of the review under the Corruption Prevention chapter focused on the engagement of the private sector in the fight against corruption – an area where Vietnam demonstrated initial progress through the revision and alignment of its legal framework, but which now requires further efforts to ensure full enforcement and implementation.

The revised Law on Anti-Corruption, which came into force in 2019, for the first time included clauses specifically relating to the private sector. Companies are required to implement codes of conduct, internal control mechanisms, and other anti-corruption measures. The challenge now is to move from the statute book to implementation to address this important issue that is impeding the consolidation of a fair and transparent business environment in Vietnam.

When the law came into force in 2019, the United Nations Development Programme (UNDP) and the Vietnam Chamber of Commerce and Industry (VCCI) conducted a survey of 239 companies. Only 60 per cent of the respondents had a clear understanding of Codes of Conduct and internal control mechanisms. The challenge was clear – institutions at the forefront of this important component of Vietnam’s future economic and social development, the VCCI and the Government Inspectorate, should take responsibility for explaining and guiding business integrity and anti-corruption to more than 800,000 companies in Vietnam.

In fact, educating the private sector has been a major part of the VCCI’s long-term commitment to “Enhancing the Integrity Initiative in Business”. Starting in 2016, the VCCI received support to promote this programme, especially from the UK government. In its first phase the scheme trained over 1,100 representatives from businesses in seven provinces and was made available at www.kdlc.vn, a business integrity web portal where companies learn more about tools on how to resist corruption.

Since 2018, the UNDP and the VCCI have collaborated to implement the latter’s Government-Business Integrity Initiative to help promote a fair, transparent, and ethical business environment through awareness raising, policy advocacy, capacity building, supporting business cases and good practices on business integrity and corporate governance, and fostering collective action in Vietnam. With the support of the UK government’s ASEAN Economic Reform Programme, the UNDP and the VCCI have trained a further 800 businesses and made available to many more with online training courses, manuals, and toolkits via the aforementioned portal.

The VCCI’s commitment to promote and strengthen business integrity in Vietnam is specifically mentioned as a positive example of private sector engagement in the latest UNCAC review report. Beyond training and guidance for business, the VCCI and the UNDP have supported inspiring examples of private sector collective action. Since 2019, 15 business associations with over 13,000 members have signed the Vietnam Business Integrity Pledge to express commitment to transparency standards.

More recently, the VCCI and the UNDP launched the Vietnam Business Integrity Network (VBIN). This is the first private sector collective action initiative committed to fostering a culture of business integrity and anti-corruption compliance in Vietnam.

It is based on lessons learned and good practices from other countries in the ASEAN region, where the private sector is at the forefront of advocating, training, and implementing anti-corruption standards and practices in large and small companies.

There are other things the business community can do to promote business integrity in Vietnam. Multinationals have a critical role to play in improving anti-corruption capacities within their supply chain. Under pressure from extraterritorial legislation and consumer and investor expectations, global multinationals operating in Vietnam are ever more conscious of the potential risks emanating from the companies in their supply chains.

The impetus to change the management systems and culture of these companies should be driven by these multinationals through training and coaching programmes for Vietnamese companies, keen to espouse and properly comply with international standards to be part of the global supply chains.

The Vietnamese economy is expected to rebound as society recovers from the pandemic and to continue expanding as an important commercial hub of the region. The VBIN will be an important platform to help companies in Vietnam strengthen their compliance practices, and so enhance sustainable business and their further integration into the global market.

The VCCI and the UNDP commit to sustaining their partnership to support Vietnam in its efforts to integrate business integrity at the core of every company’s value system, ansd a key to the realisation of the Sustainable Development Goals by 2030.